Leased Fee Conversion Tax Credit Bill Conference Committee Hearing

There is a hearing on Monday, April 25, 2005 at 3:00 p.m. in room 312 on some bills of interest to community associations before a Conference Committee.

House Conferees: Representatives Kanoho/Kahikina/Hiraki/Nishimoto, Co-Chairs; Fox
Senate Conferees: Senators Menor, Chair; Taniguchi, Co-Chair; Espero, Tsutsui, Hogue

The hearing notice discusses the following bills of interest to community associations:

HB 1554 SD2 This bill would exempt from taxation 50% of the income received from the sale to a lessee of the leased fee interest in a residential house lot or multi-family residential leasehold property, or to the association of apartment owners, residential cooperative, or planned community of the multi-family residential leasehold building. Since Honolulu repealed Chapter 38 providing for mandatory conversion of the leased fee interest in condominiums and residential cooperatives, the tax incentive would be a welcome change to the law which may remove one reason a lessor may be unwilling to sell the leased fee interest to the lessees. Unfortunately, the Senate reduced the amount that would be exempt from 75% to 50%. In addition, it inserted a defective effective date of July 1, 2050.

AS THIS IS A DECISION MAKING MEETING ONLY, NO PUBLIC TESTIMONY WILL BE ACCEPTED. You can of course contact any of the conferees.